Has Competition Increased Hospital Technical Efficiency?

Lee, Keon-Hyung; Lim, Seunghoo; Park, Sang Chul

doi:10.1097/hcm.0000000000000061

Cited by 24 publications

(20 citation statements)

References 23 publications

(22 reference statements)

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“…In addition, economic market theories predict that hospital competition will motivate hospitals to seek to improve their quality of health care delivery to attract patients . However, in the market for hospital services, it is unclear whether hospital competition enhances hospital efficiency . Some studies have found that when a hospital was located in a highly competitive market, its efficiency score was higher than the scores of hospitals in a less competitive market .…”

Section: Theoretical Foundation/conceptual Modelmentioning

confidence: 99%

“…Over the last 2 decades, US hospitals have been facing increasing external pressures to maximize their performance in providing quality care. These external pressures include expansion of managed care, market competition, public policy, number of uninsured, and shortages of health care professionals . For instance, in 2014, to decrease preventable adverse events and enhance efficiency of patient care, the Centers for Medicare and Medicaid Services (CMS) established the Hospital‐Acquired Condition Reduction program for reducing payments to the lowest‐performing hospitals .…”

Section: Introductionmentioning

confidence: 99%

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Impact of Medicare Advantage penetration and hospital competition on technical efficiency of nursing care in US intensive care units

Min

Scott

Park

et al. 2018

Health Planning & Management

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This study aimed to evaluate technical efficiency of US intensive care units and determine the effects of environmental factors on technical efficiency in providing quality of nursing care. Data were obtained from the 2014 National Database of Nursing Quality Indicators and the Centers for Medicare and Medicaid Services. Data envelopment analysis was used to estimate technical efficiency for each intensive care unit. Multilevel modeling was used to determine the effects of environmental factors on technical efficiency. Overall, Medicare Advantage penetration and hospital competition in a market did not create pressure for intensive care units to become more efficient by reducing their inputs. However, these 2 environmental factors showed positive influences on technical efficiency in intensive care units with certain levels of technical efficiency. The implications of the study results for management strategies and health policy may vary according to the levels of technical efficiency in intensive care units. Further studies are needed to examine why and how intensive care units with particular levels of technical efficiency are differently affected by certain environmental factors.

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Section: Theoretical Foundation/conceptual Modelmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Impact of Medicare Advantage penetration and hospital competition on technical efficiency of nursing care in US intensive care units

Min

Scott

Park

et al. 2018

Health Planning & Management

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“…The SE in the eastern region increased, and PTE remained high. Since the 2012 reform of county-level public hospitals, they have implemented a series of measures for their existing management systems, compensation mechanisms, personnel distribution, and cost structures [5] . Although the TE of the hospitals in the three Chinese regions declined, overall it was trending upward.…”

Section: Discussionmentioning

confidence: 99%

“…County-level public hospitals, as the leaders of China's three-tiered rural health care network, have a positive effect on the normal use of tertiary health care networks [2][3][4] . As medical institutions for the treatment of frequently occurring and common diseases, county-level public hospitals have been affected by their own efficiency in addition to objective reasons such as regional economic and social development [4][5] . If a hospital's operating efficiency is low, more government investment will fail to improve its efficacy and waste resources, exacerbate the shortage of resources, and affect patients' medical experiences.…”

Section: Introductionmentioning

confidence: 99%

A Study on the Efficiency and Productivity of County-Level Hospitals from the Perspective of Regional Contrast in China: Data Envelopment Analysis and the Malmquist Index

Wang¹,

Li²,

Wang³

2020

Preprint

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BackgroundCounty-level public hospitals play an important role in China's medical tertiary health care network. Since a new round of medical reforms occurred in 2009, county-level public hospitals have conducted continuous exploration and reforms. To analyze the efficiency and productivity of 36 county-level public hospitals based three provinces in China.Methods.We randomly selected 12 county-level hospitals from each 3 provinces based on economic levels and regional differences in China, finally, a total of 36 county-level hospitals were chosen, and a self-made questionnaire was used to investigate hospital operations for collecting data from 2011 to 2015. 2011–2015 is the twelfth five-year period of China's national economic and social development. Four input indicators and three output indicators were selected. Data envelopment analysis and the Malmquist index methods were used to measure the efficiency and productivity by the key indicators for each region.Results.On average, four input indicators in three regions have continued to grow from 2011 to 2015. The output in the three regions is directly proportional to the upward trend in inputs. On average, the three output indicators of hospitals in the eastern region are higher than the central and western regions. The technical efficiency of county-level public hospitals in the central, eastern, and western regions of China were on an upward trend, and the number of the technical efficiency, the pure technical efficiency, and the scale efficiency values reaching 1 in the three regions was more than half, respectively. The average of total factor productivity change for 2011–2015 in the central, eastern, and western regions was 1.016, 0.997, and 0.930, respectively.Conclusions.The efficiency of the central Chinese region was mainly affected by pure technical efficiency; however, scale efficiency changed to affect the efficiency of the eastern and western hospitals in 2015. The increase in production efficiency in the central region was driven by the technical efficiency. In the future hospital management, management innovation needs to be strengthened. The decline in productivity in the eastern region was due to the decline in the technical efficiency. At present, the eastern region pays attention to management innovation, but it is necessary to be alert to the adverse consequences of the expansion of hospital scale. The decline in productivity in the western region was due to the decline in the technological efficiency and technical efficiency. The hospitals should strengthen hospital management and blind scale expansion. Financial subsidies in the western region have a significant role in promoting the development of hospitals. The internal management innovation of hospitals in the eastern region has a positive effect on the technical efficiency of hospitals. The medical reform measures in the central region have positively promoted the efficiency of hospitals.

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“…In conventional markets, this may lead to greater efficiency; however, it is not always the case in the healthcare market [53]. A study in 2001-2004, assessing the effects of competition on efficiency among hospitals in Florida found that hospitals located in a less competitive market had lower technical efficiency scores than those in a more competitive market [54]. In contrast, research on hospital efficiency in Turkey indicates that efficiency is not significantly affected by the intensity of competition among hospitals [55].…”

Section: Competitionmentioning

confidence: 99%

Determinants of Hospital Efficiency: insights from the literature

Asbu

Masri

Naboulsi³

2020

Preprint

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BackgroundAchieving Universal Health Coverage and other health and health-related targets of the sustainable development goals entails curbing waste in health spending due to inefficiency. Inefficiency is a pervasive problem in health systems. The World Health Organization estimates that on average, 20-40% of the global total health expenditure is wasted. The proportion of total health expenditure attributed to hospitals is high, which implies that improving the efficiency of hospitals will lead to more efficient health systems. This study aims to synthetize the major determinants of hospital inefficiency and to develop a framework to identify causes of inefficiency and develop multi-factor interventions to address inefficiencies. MethodsThe study is based on survey of the literature on hospital efficiency and its determinants. The studies include those that employ ratio methods of efficiency analysis, data envelopment analysis and stochastic frontier models and econometric models such as the tobit regression to assess determinants of technical efficiency. Data was extracted in a table format categorized as those that are within the hospital, outside the hospital but within the health system and those that are outside the hospital and health system in the broader macroeconomic system and analyzed. ResultsHospital efficiency is influenced by factors that may be internal to the hospital or external and thus could be wholly or partially out of the control of the hospital. Hospital-level characteristics that influence efficiency include ownership, size, specialization/scope economies, teaching status, membership of multihospital system and other factors such as case-mix and ratio of outpatients to inpatients. However, the effects of these variables are not definitive and consistent; all depends on the context. Factors out of the direct control of the hospital include geographic location, competition and reimbursement systems. The findings further elucidate that no single factor is effective in addressing hospital inefficiencies in isolation from others.

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Has Competition Increased Hospital Technical Efficiency?

Cited by 24 publications

References 23 publications

Impact of Medicare Advantage penetration and hospital competition on technical efficiency of nursing care in US intensive care units

Impact of Medicare Advantage penetration and hospital competition on technical efficiency of nursing care in US intensive care units

A Study on the Efficiency and Productivity of County-Level Hospitals from the Perspective of Regional Contrast in China: Data Envelopment Analysis and the Malmquist Index

Determinants of Hospital Efficiency: insights from the literature

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